“The story in London's Independent newspaper last week was unequivocal: Chevron has been fined more than $8 billion for causing an environmental disaster called by some "the Amazon's Chernobyl"....This is the same Chevron that is running a glossy "We Agree" branding campaign that claims it's in a conversation with people about saving the planet and, oddly enough, supporting communities.”

“You just can't take Chevron's branding seriously if you know what it's doing in Ecuador.”

“Every CMO should take note of this dichotomy: Both stories are true when presented separately. It's only when you put them together -- which is exactly what I think consumers are going to begin to do more of -- that they add up to one big lie.”

As Baskin notes, it’s clear Chevron’s expansive ad and public relations department isn’t coordinating with Chevron’s expensive legal team, Gibson Dunn, the law firm that promises to change the law if the law gets in the way of their clients’ goals.

Baskin wrote:

“...(Chevron’s) legal team has been fighting a lawsuit triggered by an operational division, using various delaying tactics reminiscent of the way tobacco companies used to keep terminally ill plaintiffs out of court. Chevron's lawyers have probably received bonuses for their accomplishments .... I find it gallingly stupid that the company ha dedicated significant money and staff resources for almost two decades to fight communities, and yet it recently decided to claim it cares about them, too.”

Baskin states bluntly that consumers can’t take Chevron seriously once they learn about the company’s behavior in Ecuador:

“Chevron's leadership must be daft if it thinks its gas-station consumers don't occasionally troll the internet for something more than a pickup poker game. Ditto for any state or federal regulator they're trying to impress. We learn things about brands far beyond the information marketers want us to know, and actions -- real-world activities, not clicks or qualitative surveys -- speak louder than words. You just can't take Chevron's branding seriously if you know what it's doing in Ecuador. The campaign all but dares people to check up on them.”

Thursday, February 24, 2011

No one is to blame for Chevron’s crimes in the Amazon but the company itself. For that reason, and in light of the recent historic court decision handed down in Ecuador, we felt it imperative to provide a brief summary of Chevron’s worst offenses.

Chevron dumped chemical-laden water into natural streams and rivers.

Chevron dumped approximately 16 billions gallons of “produced water”—water extracted from the ground during oil drilling that is loaded with toxic chemicals—into jungle soils and streams near its well sites. At each of its processing stations, Chevron built large pipes that drained directly into nearby streams and rivers. At the time it was dumping this toxic water into the rainforest, the evidence shows that Chevron was well aware of its dangerous effects and had developed technologies to minimize its risks. It refused to apply any of those technologies in Ecuador. In fact, Chevron was still dumping produced water directly into streams and rivers in Ecuador over 70 years after the industry had stopped the practice in the United States due to its damaging environmental effects.

View this video of a former Chevron employee in Ecuador explaining how oil workers were told to dump toxic waste directly into the rainforest environment.

Chevron dug unlined earthen pits and filled them with a “toxic soup of oil drilling byproducts.”

Chevron dug approximately 900 open, unlined, earthen pits and filled them with “drilling muds”—a toxic soup of oil drilling byproducts that includes barium, heavy metals (e.g., chromium, lead, and zinc), chloride, petroleum compounds, and acid. It dumped these chemical-laden byproducts despite knowing they were a source of pollution and had a disastrous environmental impact. In fact, the petroleum industry had generally stopped this practice in the 1940s. As one eyewitness to this practice recalled:

“[W]hen the petroleum came out, part of it was scattered at the beginning of the platform, and another part went to the pits with sand; once in the pit it was set on fire, burning the surrounding woods; the petroleum on the platform went straight to rivers and estuaries.”

Although Chevron was well aware its pits filled with oil drilling byproducts were leaking into the soil and groundwater, it did nothing in order to save money. Letters discovered during the litigation clearly show that Chevron made a conscious choice not to fix its outdated and outmoded toxic pits that continued to dump chemicals into the rainforest. A 1980 letter between a Chevron (then Texaco) District Superintendent and an engineer states determines that the costs of more environmentally safer alternatives including installing steel pits or digging new pits and coating them would be too costly.

Chevron spilled thousands of barrels of oil.

Chevron failed to maintain or monitor its oil pipelines in the region, which resulted in many oil leaks and spills going undetected with no cleanup effort. The Big Oil company spilled at least 26,400 barrels of oil, most due to a lack of preventative maintenance on its equipment. Chevron did not have a spill prevention or response plan. Rather than clean up its spills, Chevron simply covered them with sand.

Chevron polluted the air.

In addition to contaminating the soil, groundwater, and streams in the rainforest, Chevron also polluted the air. Chevron disregarded accepted industry methods and technologies to reduce harmful air pollution and instead vented large quantities of gas directly into the atmosphere. Chevron used a practice called “horizontal flaring” which was a disfavored practice in the United States by the 1950s. This practice resulted in large plumes of black smoke that choked the life out of the region.

There is lot more on these devastating facts and on how Chevron tried to cover up its hideous environmental practices in the plaintiff’s final argument presenting overwhelming scientific evidence of Chevron’s mess in Ecuador. Chevron can waste millions of dollars obscuring their crimes. But they will never change the facts.

Tuesday, February 22, 2011

If you read the press clippings about the recent $8.6 billion judgment against Chevron for massive oil contamination in the Ecuadorian rainforest, you would think Chevron will never be forced to pay a penny in damages. Chevron’s press release reads: “"The Ecuadorian court's judgment is ... unenforceable. .... Chevron does not believe that today's judgment is enforceable in any court ...”

One oil industry analyst for Raymond James said the day after the judgment that Chevron would never pay. “It’s impossible to take this verdict seriously.”

Maestro has been singing a different tune in the oil giant’s desperate arguments to have the federal court prevent the enforcement of the Ecuadorian court’s judgment that, by the way, does not fall under its jurisdiction. Here are a few recent comments made in open court before the Southern District Court of New York:

“We are facing the ultimate Sword of Damocles, and it is over our heads ….

“Plaintiffs are going to attempt to enforce that judgment through potential prejudgment attachments that will cause disruption, pressure, irreparable harm to Chevron ….

“It seems obvious to us that there will be irreparable harm from seizing boats, seizing ships, seizing tankers, disrupting the distribution stream of Chevron that will affect it not only in the one jurisdiction but around the world, an irreparable harm ….

“How are they ever going to make Chevron whole for the irreparable harm they are going to cause? ….

“That is irreparable harm both in terms of disruption of operations, business reputation and good will, and an inability to ever get that money back. ….

“They could be taking the judgment they have now around the world trying to wreak havoc ....

“So we are definitely right now in a position of that nightmare is here, irreparable harm is imminent ….. ”

Friday, February 18, 2011

A San Francisco judge ruled that Diego Borja, Chevron’s "dirty tricks" agent who is responsible for recording misleading tapes of Ecuadorean Judge Juan Nunez, has to turn over hundreds of documents and testify about his role in falsifying evidence related to the pollution lawsuit by March 21. This will give plaintiffs a chance to question the man who has played a big role in Chevron’s attempts to undermine the multi-billion dollar environmental trial.

SAN FRANCISCO (Reuters) - Plaintiffs in the Ecuador pollution case against Chevron Corp will get to question the man they call the "ringleader" of a sting operation that is key to Chevron's efforts to avoid paying a massive judgment.

The deposition of Diego Borja will be the first chance for the plaintiffs to use the same kind of U.S. legal device extensively used by the oil company in building its extortion case against them.

The Borja ruling comes just days after an Ecuadorean court awarded plaintiffs $8.6 billion in damages -- which is set for appeal -- and offers the Republic of Ecuador a chance to gather evidence for a case before an international tribunal that was brought by Chevron under a U.S.-Ecuador treaty.

A U.S. magistrate judge in San Francisco ruled late on Wednesday that Borja, one of two men who secretly taped Ecuadorean Judge Juan Nunez discussing the pollution case, must surrender hundreds of documents this week and travel from Texas to submit to three days of questioning at some point before March 21.

The decision means the Republic of Ecuador, the plaintiffs and Chevron can question Borja under a procedure known as a 1782 action, which was used by Chevron to force plaintiffs' lawyer Steven Donziger to turn over a trove of evidence.

Ecuador originally filed the action alone, but the potential for appeals in the Ecuadorean case brought in the plaintiffs, who are indigenous people backed by U.S. lawyers.

Plaintiffs' lawyer James Tyrrell, from Washington D.C. law firm Patton Boggs, flew in to appear before Judge Edward Chen in the federal court for the Northern District of California.

"We think we have the ringleader of the dirty tricks," said Tyrrell, whose firm took a lead role in the plaintiffs' case after Donziger came under fire.

Borja, along with American Wayne Hansen, secretly taped videos of Nunez in 2009 before turning them over to Chevron. The company then released them online in August 2009, and moved Borja and his wife to a home near its headquarters in San Ramon, California, 30 miles east of San Francisco.

Three weeks later, Chevron claimed Ecuador had violated a bilateral U.S.-Ecuador investment treaty because its judicial system was not independent. Nunez recused himself, and his successor was replaced late last year by Nicolas Zambrano, who delivered the damages ruling on Monday.

The plaintiffs managed to locate a Borja acquaintance who had records of conversations in which Borja said he had incriminating evidence against Chevron that he could use as leverage if the company "betrayed" him.

Plaintiffs also say Borja and his wife were representatives of a firm involved in independent tests of soil samples related to the pollution case -- originally brought against Texaco in 1993 and inherited by Chevron when it bought Texaco in 2001.

Responding to Chen's decision, Chevron said in an emailed statement: "The government of Ecuador has done nothing to address the misconduct of one of its judges and it seems the government remains more interested in persecuting Mr. Borja than addressing corruption in its courts."

Earlier on Thursday, Chevron lawyers in Ecuador requested clarification of the $8.6 billion ruling, which found it liable for contaminating the jungle and damaging local people's health in the two decades before Texaco left in 1992.

The cases in the U.S. District Court for the Northern District of California are In re: application of the Republic of Ecuador, case no. 10-mc-80225, and In re: application of Daniel Carlos LusitandYaiguaje, et al., case no. 10-mc-80324.

Wednesday, February 16, 2011

Earlier this week an Ecuadorian court found Chevron guilty of polluting the Ecuadorian rainforest and ordered the oil giant to pay $8.9 billion in damages. Not surprisingly, but the company is ignoring the ruling and still refuses to clean up, pay or apologize to those suffering from the contamination. Fortunately Chevron’s unethical behavior has not been unnoticed. Visit Time’s picture gallery to see some heartbreaking photos that describe the damage done by Chevron better than any words. Below is a blog by Time’s Krista Mahr.

Ecuador to Chevron: Pay Up. And Say You're Sorry.

Posted by Krista Mahr

A judge in Ecuador handed down a landmark ruling against oil giant Chevron this week, ordering the company to pay $8.6 billion and another 10% of that sum in reparations to the Amazon Defense Coalition for oil pollution damages in a remote rainforest on the South American country's northeast border.

The ruling – one of the largest environmental judgments ever made — is the latest tick in a 17-year drama between Amazonian villagers, who form the Coalition, and the U.S. oil company. The judge has also said that if Chevron does not issue a public apology within 15 days of the ruling, the fine will be doubled.

Chevron's not likely to deliver that apology anytime soon. Chevron does not, in fact, operate in Ecuador today; the American company acquired the lawsuit when it bought Texaco in 2001. Texaco started oil exploration activities with Ecuador's state oil company Petroecuador back in 1964, and for the next three decades, the 47 plaintiffs say, the company contributed to dumping billions of gallons of waste oil in the region, causing loss of livelihood, widespread health problems and up to 1400 deaths. Monday's judgment awards some $5 billion to soil restoration and some $2 billion to healthcare.

Both sides more or less agree on the basic premise that oil exploration caused pollution in a remote swath of Amazonian rainforest. It's the extent of the pollution, the extent of the repercussions of that pollution, and the extent to which Chevron is responsible for them, that is contested. Texaco paid $40 million to the government to help the region before it left Ecuador in 1992. The plaintiffs, unsatisfied, filed a case against Texaco in 1993.

Since acquiring its subsidiary's unresolved legal landmine, Chevron has spent millions fighting it, saying Texaco paid its due, and that much of the damage happened after Texaco left. The corporation also claims the legal process since then has been deeply flawed, and that the Ecuadorian courts have been in collusion with the plaintiffs. Last week, Chevron filed its own lawsuit against the plaintiffs in the U.S. for extortion and manipulation of the legal system in Ecuador. The fact that the verdict in Ecuador came a week later fueled Chevron's claims that the court was not operating independently. A Chevron spokesperson immediately said that the company has no intention of paying the damages and will appeal the ruling in the Ecuadorian legal system.

The plaintiffs, who are not happy with the $8.6 billion, plan to appeal the award amount. According to the New York Times, the Coalition also intends to wage legal battles against Chevron in more than a dozen countries where it has large operations, such as the U.S., Brazil, Venezuela, and Canada, to pressure the company to pay up.

At least one of Coalition's legal assessments estimates damages to run as high as $113 billion. After the trial, one tribe leader from the affected area told the BBC that two of his children had died from drinking contaminated water. “You can't recover dead people, there is no price for that,” he told the news outlet. “Our demand is to get enough money to clean up our Amazon.”

Tuesday, February 15, 2011

After 18 years of litigation in both the U.S. and in Ecuador, a court of law has found Chevron accountable for the massive contamination of the Ecuadorian rainforest. Below is a statement from the Ecuadorians who have lived with Chevron’s pollution for five decades. Also below is the front page article that appeared today in the Wall Street Journal.

Pablo Fajardo, the lead Ecuadorian attorneys representing the indigenous tribes suing Chevron for oil contamination, released this statement today about the judgment against Chevron, issued by the Provincial Court of Justice of Sucumbíos in Lago Agrio, Ecuador:

“We believe today’s judgment affirms what the plaintiffs have contended for the past 18 years about Chevron’s intentional and unlawful contamination of Ecuador’s rainforest. Until we have had a chance to review the lengthy decision, we will not be able to comment in detail.

“As a general matter, the plaintiffs provided the court with a great quantum of scientific and documentary evidence that Chevron deliberately and in violation of all industry norms discharged billions of gallons of toxic waste into the rainforest and into the water supply relied on by thousands of Ecuadorian citizens.

“Rather than accept that responsibility, Chevron has launched a campaign of warfare against the Ecuadorian courts and the impoverished victims of its unfortunate practices. We call on the company to end its polemical attacks and search jointly with the plaintiffs for common solutions. We believe the evidence before the court deserves international respect and the plaintiffs will take whatever actions are appropriate consistent with the law to press the claims to a final conclusion.”

An Ecuadorian judge on Monday ordered Chevron Corp. to pay $8.6 billion to clean up oil pollution in the country's rain forest in what is believed to be the largest-ever judgment in an environmental case.

And if the U.S. oil giant doesn't publicly apologize in the next 15 days, the judge ordered the company to pay twice that amount.

The ruling brings to an end one chapter of a legal drama that has played out in courtrooms in Ecuador and the U.S. for nearly two decades.

The case has been bitterly fought by both sides, with each accusing the other of improprieties. In recent months, Chevron uncovered a secret memo revealing the plaintiffs' strategy for enforcing any favorable Ecuadorian ruling around the world. That means that Chevron could be forced to defend itself in any of the dozens of countries where it does business.

The oil company, which denies responsibility for the pollution, has no assets in Ecuador and has vowed to fight any efforts to seize its property overseas. Other multinational corporations are closely watching the case.

The plaintiffs, residents of Ecuador's oil-rich Amazon rain forest, are seeking to hold Chevron accountable for environmental damage they say was caused by Texaco Inc., which operated in the country from 1965 to 1992. Chevron inherited the case when it acquired Texaco in 2001.

Chevron has said for more than a year that it expected to lose the case in Ecuador, where it says collusion between the government and the plaintiffs have made a fair ruling impossible. On Monday, the company vowed to appeal and said it won't pay the fine or apologize as the judge demanded.

"We believe it to be illegitimate and unenforceable," Chevron spokesman Kent Robertson said. "It's the product of fraud, and it's contrary to the legitimate scientific evidence."

The ruling was a rare piece of good news for the plaintiffs after months of setbacks in U.S. courts that left their team divided and scrambling for cash.

But the victory could be short-lived. Last week a panel of international arbitrators in The Hague granted Chevron a preliminary injunction that could block the plaintiffs' efforts to enforce the judgment.

Steven Donziger, a New York lawyer who led the case for years until Chevron's continued attacks caused him to step down as lead plaintiffs' attorney, declined to comment. Instead, the plaintiffs released a statement from their Ecuador-based attorney Pablo Fajardo.

"We believe today's judgment affirms what the plaintiffs have contended for the past 18 years about Chevron's intentional and unlawful contamination of Ecuador's rain forest," he said.

Under Ecuadorian law, Chevron doesn't have to pay any judgment until after an initial appeal, which could take months.

Meanwhile, Chevron is using the U.S. courts, in hopes of never paying anything at all. The company sued the plaintiffs and their lawyers in the U.S., where a federal judge recently issued a temporary stay blocking the plaintiffs' American lawyers from seeking to enforce any judgment.

Chevron has also sued the country of Ecuador under the terms of a trade agreement between it and the U.S. Last week, a panel of arbitrators in The Hague ordered Ecuador to take "all measures at its disposal" to block enforcement of any ruling, both in Ecuador and overseas, until the panel rules on the case. That could make it much more difficult for the plaintiffs to convince a foreign court to seize Chevron's assets.

Ecuador has asked a U.S. court to block Chevron's trade suit and has challenged the panel's jurisdiction.

Even if Chevron never has to pay, the ruling could worsen what has already been a public relations nightmare for the oil giant when all oil companies are under added scrutiny in the wake of last year's oil spill in the Gulf of Mexico.

Investors, however, shrugged off the ruling Monday. Chevron's shares rose 1.3% to $96.95 in 4 p.m. composite trading on the New York Stock Exchange.

The judge ruled Chevron must pay $5.4 billion to restore polluted soil and $1.4 billion to create a health system for the community, among other penalties. The court also ruled that Chevron should pay the Amazon Defense Front, a coalition formed by the plaintiffs, an additional 10% in damages, or about $860 million. That could bring the total judgment to $9.5 billion.

In the ruling, Judge Nicolas Zambrano said that Texaco had the knowledge and technical ability to avoid damages; the damages "were not only foreseeable, but also preventable."

Few legal experts expected the case to get this far. The plaintiffs first sued Texaco in New York in 1993. Texaco, and later Chevron, successfully argued that the case should instead be heard in Ecuador, which was then run by a government seen as friendly to American business interests.

In 2007, however, Ecuador elected as president Rafael Correa, who has publicly supported the plaintiffs' cause. Chevron accuses the left-leaning government of interfering in the case, a charge the government denies.

Many of Chevron's fraud allegations involve a report from a court-appointed expert, Richard Cabrera, who in 2008 estimated Chevron's liability at more than $27 billion. Chevron said the report was actually written by experts hired by the plaintiffs, who then sought to cover up their involvement. In his ruling, however, the judge said he didn't base his opinion on the evidence presented by Mr. Cabrera, because of the fraud allegations.

The plaintiffs have taken steps that may leave them better prepared for the next phase of the case. They have secured millions of dollars in new financing, some of it from a London-based hedge fund that specializes in backing class-action suits. And they have hired new lawyers, led by Washington law firm Patton Boggs.

Lago Agrio, Ecuador -- Chevron has found that dumping of billions of gallons of toxic waste into Ecuador's Amazon didn't harm a single person or the environment, according to the company's final argument submitted to the Ecuador court hearing the historic environmental case.

Chevron denies in the 292-page document that there are damages despite admitting during the trial that it dumped billions of gallons of chemical-laden "water of formation" into the streams and rivers of the Amazon that indigenous groups relied on for their sustenance. The indigenous groups are now decimated because of the toxic waste, according to evidence submitted to the court.

"The plaintiffs have not established that there was any negligence" on the part of Chevron in its operations in Ecuador, the company claims in the document "The plaintiffs have not proven the existence of the supposed damages … that they allege in their lawsuit," it added.

Curiously, Chevron's final argument -- called the "alegato" in Ecuador -- can not be found on the company's website or in its press materials. The company for weeks has refused to publicize its final argument in a case the company claims that it should win based on the evidence.

"Chevron is embarrassed to promote a document that is so clearly misleading," said Karen Hinton, a spokesperson for the 30,000 plaintiffs who brought the lawsuit. "Chevron's final argument makes a mockery out of the evidence at trial and is so deceptive that not even Chevron wants people to read it."

Chevron from 1964 to 1990 operated a large oil concession in an area of Ecuador the size of Rhode Island, reaping billions of dollars in profits before pulling out of Ecuador in 1992.

Chevron has admitted during the trial that it created in Ecuador a system of oil extraction that led to the deliberate discharge of more than 16 billion gallons of chemical-laden "water of formation" into the streams and rivers of Ecuador's Amazon, home to six indigenous groups.The dumping of the toxic "formation water" was confirmed by the company's own environmental audits by environmental sampling, and by Rodrigo Perez Pallares, Chevron's legal agent in Ecuador who admitted to the practice.

The lawsuit also accuses Chevron of abandoning more than 900 unlined waste pits gouged out of the jungle floor that leech toxins into soils and streams; contaminating the air by burning the waste pits; dumping oil along roads; and spilling millions of gallons of pure crude from ruptured pipelines. Internal company documents demonstrate that Chevron officials ordered field workers to destroy records of oil spills, that the company refused to develop an environmental response plan or pipeline maintenance program, and that Chevron never conducted a single health evaluation or environmental impact study despite the obvious harm it was causing.

Chevron's "alegato" claims that not even one person in Ecuador was harmed by the company's operations, even though several independent studies in academic journals suggest dramatically higher rates of cancer and other health problems in the region where the oil giant operated. Studies show thousands of people have either died or are at increased risk of contracting cancer due to the contamination.

"Chevron's final argument is scientifically and morally bankrupt," said Hinton, the spokesperson for the plaintiffs. "It is just astonishing that a public company continues to bury its responsibility for causing a flagrant and ongoing human rights violation that is putting thousands of lives at risk."

Chevron's "alegato" in Ecuador continues the longstanding practice of the company of ignoring scientific evidence and denying all responsibility for causing environmental harm.

Chevron's lead scientific expert in the Ecuador trial, the American John Conner, has admitted under oath in U.S. court that his company never found that any of Chevron's activities worldwide have harmed a single individual. Conner has been working for Chevron on a variety of lawsuits for most of two decades and has been paid at least $5 million for his work in the Ecuador trial.

The Connor testimony in a trial last year in Mississippi, was rejected by a jury and resulted in a $19 million judgment against Chevron.

The plaintiffs submitted the first part of their "alegato" on January 18, finding "irrefutable evidence of contamination" at each of Chevron's 45 well and production sites inspected by the parties during the trial. The chemicals found -- all of which are toxic and some of which are known carcinogens -- include barium, benzene, cadmium, chromium, copper, etheylbenzene, polycyclic aromatic hydrocarbons, vanadium, xylene, and zinc. The plaintiff's alegato concluded that the sampling results and other evidence provided by Chevron prove the claims of the plaintiffs.

Friday, February 4, 2011

Chevron has gone even further with its bullying practices in the environmental lawsuit over the contamination in Ecuador. Chevron lawyers threatened Nicolas Zambrano, the trail judge overseeing the case, with criminal sanctions and prison, if Chevron’s motion to nullify the trail is denied.Pablo Fajardo, the Ecuadorian lawyer representing the plaintiffs said:

"Chevron's threat to the judge is another example of its abuse of the rule of law and its desperation to avoid a judgment,"

"Threatening judges with criminal sanctions is typical of the Chevron way when it comes to litigating in Ecuador,"

Below is the press release by Amazon Defense Coalition with more details about Chevron’s threats toward the judge.

Chevron Threatened Ecuador Judge With Prison Time If He Failed to Grant Motions, Court Papers Say

Lago Agrio, Ecuador (February 3, 2011) -- Chevron's lawyers in Ecuador have threatened the trial judge overseeing the historic environmental trial where the company faces a potential judgment in the billions of dollars, according to court papers made available by the plaintiffs.

In a series of recent legal papers, Chevron lawyers Enrique Carbajal and Alberto Racines threatened trial Judge Nicolas Zambrano with criminal sanctions and prison if he failed to grant their motions asking for a dismissal of the case, which has been on trial since 2003 in the Amazon town of Lago Agrio. The threats were clearly outlined in motions signed by the two lawyers and submitted to the court, said Pablo Fajardo, the Ecuadorian lawyer for the plaintiffs.

"Chevron's threat to the judge is another example of its abuse of the rule of law and its desperation to avoid a judgment," said Fajardo, who represents an estimated 30,000 Ecuadorians who brought the lawsuit.

Judge Zambrano recently sanctioned and fined Racines approximately $1,600 for repeatedly filing the same motions in an effort to delay the Ecuador trial. A third Chevron lawyer in Ecuador – Patricio Campuzano – was sanctioned for the same reason 2009. Also that year Racines exploded in anger at a trial testing site when oil was found at one of Chevron’s so-called “remediated” sites.

The first motion, filed by Carbajal on Chevron’s behalf, falsely claimed that the signatures of twenty of the 48 signatories to the lawsuit -- almost all indigenous persons and impoverished farmers -- were forged by attorneys for the plaintiffs. The plaintiffs rejected the claim and most of the 20 farmers appeared at a recent public event to verify that they actually signed the original lawsuit.

In the motion seeking the annulment of the trial based on the supposedly "forged" signatures, Carbajal wrote to the judge: "If you deny this motion, your conduct will fall within Article 292" of the criminal code of Ecuador, which requires a criminal sentence of up to six months for any public official who does not report a crime.

One day later, Racines filed a motion asking Judge Zambrano to nullify an expert report submitted by the plaintiffs by Dr. Lawrence Barnthouse, a renewed American natural resources ecologist. Racines, also citing Provision 292 of Ecuador's criminal code, said to the judge that "if you don't do it, you will have committed a criminal infraction punished by prison."

"Threatening judges with criminal sanctions is typical of the Chevron way when it comes to litigating in Ecuador," said Fajardo. "They would never attempt such intimidation tactics in U.S. courts."

In addition to the threats, Chevron has repeatedly been charged with trying to use intimidation tactics to dissuade law firms and financial partners from working with the plaintiffs, who live in dire conditions in approximately 80 different indigenous and farmer communities spread throughout the rainforest.

In recent days, Chevron has sued each of the 47 named plaintiffs in New York federal court; sought an unprecedented injunction from a U.S. federal judge to bar any American lawyer working on the case from enforcing a judgment from Ecuador's court anywhere in the world; and has actively tried to depose several of the plaintiff's lawyers. All told, the company has tried to depose 33 people in the U.S. who have worked with the plaintiffs.

Chevron also filed a civil RICO suit in New York, claiming the indigenous groups were trying to extort money from Chevron via the lawsuit.

"Chevron is acting out of pure desperation because we are nearing judgment," said Karen Hinton, the spokeswoman for the plaintiffs. "The company's new legal actions are designed to intimidate lawyers and funders and to provide a fake cover story for shareholders when the company is hit with an adverse judgment."

The environmental lawsuit charges Chevron with deliberately discharging more than 16 billion gallons of chemical-laced "formation water" into the streams and rivers of the Amazon over a 26-year period when it operated a large oil concession, decimating indigenous groups and poisoning an area the size of Rhode Island. The case was moved from U.S. federal court at Chevron's request after Chevron filed 14 sworn affidavits praising Ecuador's court system.

The top end of the damages claim recently submitted by the plaintiffs in their final argument is $113 billion. The plaintiffs have submitted tens of thousands of chemical sampling results that prove extensive soil contamination at 100% of Chevron's 378 former well and production sites in the Amazon.

"In the end, the voluminous scientific evidence will triumph over Chevron's intimidation tactics," said Fajardo.

Thursday, February 3, 2011

Two interesting perspectives on Chevron’s efforts to turn the victims of its misconduct into criminals. One is from a Huffington Post blogger, Joanna Zelman, who concludes her piece with:

“The finger pointing, intimidation, lawsuits, and countersuits all blur into what might appear to be just a big game. But at its core, there are human beings seeking justice, and a company terrified of what justice might find.”

“For me, the take-home message is that, regardless of whether any (or all) of what Chevron alleges is true, it doesn't (or shouldn't) absolve them of their responsibility to clean up the mess in Ecuador, and it doesn't give them any reason to proceed against the Lago Agrio plaintiffs themselves.”

Is Chevron's countersuit against Ecuador's plantiff lawyers legitimate or an act of intimidation? Chevron's recently filed Racketeer Influenced and Corrupt Organizations Act (RICO) lawsuit suggests that the oil company may be resorting to threats in a last ditch effort to derail a historic case that has dragged on for nearly 20 years - the original lawsuit was first filed back in 1993.

Chevron's subsidiary, Texaco Inc. used to run several Ecuadorian oil fields until the 1990's, when Petroecuador took over. The plaintiff reports that when Chevron operated the oil fields, the company engaged in acts harmful to the local health and environment.

Chevron meanwhile has stated that after a $40 million cleanup, any remaining contamination is Petroecuador's responsibility. R. Hewitt Pate, Chevron's vice president has stated that the company "has no intention of giving these plaintiffs' lawyers the payday they seek."

Now, as judgment nears, Chevron has made some bold moves. This past Tuesday, Chevron filed a countersuit against Ecuador's lawyers and consultants. Chevron accused the consultants of ghost-writing an expert's report and fabricating a peer review. With these claims of fraud, Chevron asks the court that any judgment against the company be deemed unenforceable.

Meanwhile, plaintiff spokeswoman Karen Hinton has deemed Chevron's countersuit an act of "corporate bullying." A press release from the Amazon Defense Coalition claims that Chevron has also recently threatened the trial judge with criminal liability, sued each of Ecuador's 47 impoverished indigenous plaintiffs in New York federal court, tried to bar any American lawyer from enforcing a judgment outside of Ecuador (an unprecedented injunction), and may have broken the record for the longest deposition of a lawyer on a sitting case.

According to The New York Times, the recently filed RICO lawsuit makes sense, as it "fits squarely within Chevron's strategy of seeking to turn U.S. courts against the plaintiffs."

While Chevron's recent conduct has come under scrutiny, the company's past conduct in Ecuadorian courts has also been questioned. The Amazon Defense Coalition's press release accuses Chevron of undercounting toxins in the soil and water with their field sampling methods, forcing an Ecuadorian judge's recusal through entrapment, and exposing more locals to toxins while obtaining a legal release from claims. A Chevron contractor also reportedly accused the company of cooking the books, switching out contaminated samples for clean ones.

Karen Hinton claims that Chevron's recent civil RICO suit was filed out of concern over Wall Street and shareholder reactions. With tens of billions of dollars on the line for Chevron's shareholders, it would certainly make sense for the company to try and pull out all the stops. Ultimately though, Ecuador's lead attorney Pablo Fajardo believes, "Irrefutable scientific truth will triumph over Chevron's intimidation tactics and desperation."

The finger pointing, intimidation, lawsuits, and countersuits all blur into what might appear to be just a big game. But at its core, there are human beings seeking justice, and a company terrified of what justice might find.

Chevron, facing a landmark lawsuit in Lago Agrio, Ecuador, over pollution left in the Amazon by its predecessor, Texaco, has increasingly gone on the offensive against the Amazonian communities bringing the lawsuit. Chevron has accused the plaintiffs, their lawyers and supporters of all manner of dirty tricks, and even denounced the awarding of the Goldman Environmental Prize to the two leading Ecuadorian lawyers. The plaintiffs in turn allege that Chevron's personnel have admitted tampering with evidence, and that Chevron hired a convicted drug trafficker to attempt to entrap the presiding judge in a bribery scheme, among other things [1].

But on Tuesday Chevron's efforts to discredit the case reached a new level, as Chevron sued the Ecuadorian plaintiffs themselves in federal court in New York, accusing them of fraud, interfering with contracts, trespass, unjust enrichment, and conspiracy. Chevron has also levied even more serious charges against the lawyers, expert witnesses and affiliated organizations, accusing them of racketeering under the Racketeer Influenced and Corrupt Organizations Act (RICO).

Most of Chevron's allegations arise out of a court-appointed expert report in Ecuador, over which theplaintiffs allegedly had improper influence, and various statements by the plaintiffs' lawyers and allies which Chevron contends are false and are calculated to force Chevron into a settlement. I have no idea whether there is any truth to Chevron's allegations, though it wouldn't surprise me if some of what has happened in the Ecuadorian court proceedings would seem unusual or even outrageous by US standards. Indeed, the plaintiffs themselves originally filed this case in New York, and wanted to litigate in the US--they didn't want the case moved to Ecuador because they feared the court system was subject to political influence and not up to the task of hearing a case like this. (At one stage when the case was in the US, ERI filed an amicus brief [2] supporting the plaintiffs.)

But three extraordinary things jumped out from my quick look at Chevron's complaint. First, while Chevron seeks orders that would prevent the plaintiffs from enforcing any judgment against them, nothing in their complaint establishes that Chevron is not responsible for environmental damage in the Ecuadorian Amazon. What Chevron is trying to do is to use alleged misconduct by the plaintiffs' lawyers to absolve them of any responsibility; a sort of judicial get-out-of-jail-free card. In fact, Chevron probably can't ask the US court to decide whether they're responsible for the environmental damage--the plaintiffs filed that case in New York fifteen years ago, and it was Chevron (or Texaco, at the time) that successfully moved it to Ecuador. One telling fact here is that Chevron only sued some of the plaintiffs' lawyers--they did not, for example, sue Patton Boggs, which is now heading up the U.S. team supporting the Lago Agrio litigation. That seems like an acknowledgement that the Lago Agrio litigation itself is not fraudulent, even if Chevron thinks some of the tactics employed by some of the lawyers have been.

Second, Chevron admits that it doesn't even have any evidence that the plaintiffs themselves had any part in the allegedly fraudulent conduct, but simply alleges that they might benefit from it: "Whether or not the individual Lago Agrio Plaintiffs were or are aware of the fraud... [they] cannot benefit from the fraud and corrupt conduct ostensibly perpetrated on their behalf." That's usually not enough to sue someone over, especially before they actually have benefited. And it doesn't at all explain why Chevron has named the plaintiffs themselves as defendants on claims of--you guessed it--fraud. Chevron needs the plaintiffs in the case because just suing the lawyers (i.e., the people who are allegedly responsible for the misconduct) won't get them a ruling that prohibits the plaintiffs from enforcing a judgment against Chevron, but the complaint against them is pretty thin. (Arguably, so is the case for jurisdiction in New York over Ecuadorians litigating a case in Ecuador.)

Third, Chevron has put the lawsuit in front of a judge who apparently suggested that Chevron should file it. I don't know Judge Lewis Kaplan, and I have no idea if he's biased or not. But Judge Kaplan did preside over two earlier cases filed by Chevron seeking discovery from the filmmaker who made the documentary "Crude" and from one of the plaintiffs' lawyers himself, and issued rulings favorable to Chevron. Chevron's own complaint states that in one of these hearings, Judge Kaplan stated, after summarizing his view of the evidence: "Now, do the phrases Hobbs Act, extortion, RICO, have any bearing here?" Whether Judge Kaplan's earlier decisions were correct or not, it certainly looks bad to have him presiding over a case that he suggested should be filed--it could give the kind of appearance of impropriety that the judicial system is supposed to avoid. Furthermore, in order to put the case in front of Judge Kaplan, Chevron used a "related cases" mechanism--they suggested that the case was related to the two other discovery cases. But they also said that no similar case had ever been filed in New York, which ignores the fact that the original case filed by the plaintiffs was in the same court. Acknowledging that might have led to the case being assigned to a different judge, however--possibly Judge Jed Rakoff, who presided over the original case.

For me, the take-home message is that, regardless of whether any (or all) of what Chevron alleges is true, it doesn't (or shouldn't) absolve them of their responsibility to clean up the mess in Ecuador, and it doesn't give them any reason to proceed against the Lago Agrio plaintiffs themselves. If I were representing the Lago Agrio plaintiffs, my first response would be to seek dismissal of the plaintiffs from this case and probably to seek sanctions against Chevron's lawyers--filing a complaint that admits that there's no evidence they engaged in fraud, yet sues them for fraud anyway, is a pretty dubious tactic, even for Chevron.

Wednesday, February 2, 2011

With the scientific evidence against Chevron in the historic Ecuador environmental trial fully before the court, the oil giant is now resorting to threats and intimidation to try to derail a final judgment that could cost the company's shareholders tens of billions of dollars.

In recent days, Chevron has threatened the trial judge with criminal liability for refusing to grant the oil giant's motions to dismiss the case; sued each of the 47 impoverished indigenous and farmer plaintiffs in Ecuador's rainforest in New York federal court; sought an unprecedented injunction from a U.S. federal judge to bar any American lawyer from enforcing a judgment out of Ecuador anywhere in the world; and finished its 13th day deposing one of the plaintiff's American lawyer, apparently breaking the record for the longest deposition of a lawyer on a sitting case.

The company also filed a civil RICO suit in New York yesterday, claiming the indigenous groups were trying to extort money from Chevron via the lawsuit.

“Chevron is acting out of pure desperation because we are nearing judgment,” said Karen Hinton, the spokeswoman for the plaintiffs. "The company's new legal actions are designed to intimidate lawyers and funders and to provide a fake cover story for shareholders when the company is hit with an adverse judgment."

A lawyer for the Ecuadorian plaintiffs said the "irrefutable" scientific against Chevron will “triumph” over the company’s desperate attempts to choke protest.

“Irrefutable scientific truth will triumph over Chevron’s intimidation tactics and desperation," said Pablo Fajardo, the lead attorney in Ecuador in the case, which accuses Chevron of poisoning an area the size of Rhode Island by dumping billions of gallons of toxic waste.

"We will not be frightened by corporate bullying,” added Fajardo. “Chevron is trying to turn the victims of its own unlawful misconduct into criminals. We will not stand for it.”

Chevron itself has engaged in a pattern of deceitful behavior in Ecuador to hide its liability from the courts and shareholders. Elements of Chevron's misconduct include:

Misrepresenting a fraudulent remediation that resulted in more Ecuadorians being exposed to toxins, but which allowed Chevron to obtain a legal "release" from government claims;

Using field sampling testing methods in the Ecuadorian trial that deliberately undercounted toxins in the soil and water;

Accusations by a Chevron contractor that Chevron "cooked" evidence in the case and contaminated samples switched out for clean ones before submitting them to a testing laboratory;

Collaborating with a self-described Chevron “dirty-tricks operative” and a convicted drug felon to entrap an Ecuadorian judge in a video scandal, forcing his recusal from the court.

Hinton also said Chevron's RICO action is clearly driven by the concern about how Wall Street and its shareholders view the pending judgment.

Diego Borja-Chevron operative who said Chevron “cooked” evidence.

Chevron is cornered by the overwhelming evidence and is desperate to escape the court of its own choosing," added Hinton. "Chevron fought for ten years to move this case from the United States to Ecuador. Now that the evidence is in, Chevron is running away from these very courts."

The Ecuadorians filed their original lawsuit in the Southern District Court of New York in 1993, but Chevron successfully fought to have the case moved to Ecuador in 2002, arguing it could get a fair trial in the South American country.